{"id":38861,"date":"2026-08-19T05:56:14","date_gmt":"2026-08-19T05:56:14","guid":{"rendered":"https:\/\/www.europesays.com\/netherlands\/38861\/"},"modified":"2026-08-19T05:56:14","modified_gmt":"2026-08-19T05:56:14","slug":"asml-stocks-18-july-drop-masks-a-bigger-story","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/netherlands\/38861\/","title":{"rendered":"ASML stock’s 18% July drop masks a bigger story"},"content":{"rendered":"

The machines behind every advanced artificial intelligence chip<\/a> in production come from one company, and its stock just dropped 18% in a single month. <\/p>\n

If you hold shares in any AI<\/a> company, this Dutch firm\u2019s technology sits at the foundation of every chip powering those investments.<\/p>\n

ASML<\/a> Holding, the manufacturer with an exclusive grip on extreme ultraviolet lithography, lost nearly a fifth<\/a> of its market value in July 2026.<\/p>\n

The decline came even after ASML raised its full-year revenue guidance for the second time this year and posted second-quarter earnings above expectations.<\/p>\n

For investors already riding the AI trade through Nvidia<\/a> or the hyperscalers, the July slide opened access to the one link in the chain none of them can replace.<\/p>\n

Two fears drove ASML\u2019s 18% July selloff<\/p>\n

Reports<\/a> that Anthropic was doing early-stage work on a custom artificial intelligence chip sent ASML shares down 7.4% on July 1.<\/p>\n

Anthropic\u2019s move followed a broader pattern of AI companies exploring in-house chip production to reduce reliance on external semiconductor suppliers and lower operating costs.<\/p>\n

The startup had opened discussions with Samsung about manufacturing the chip, a report by The Information revealed<\/a>, triggering a sell-off across the broader semiconductor sector.<\/p>\n

The second blow came on July 27, when reports emerged that a Chinese government-backed company had begun manufacturing deep ultraviolet lithography machines for chipmaking.<\/p>\n

ASML shares closed 6%<\/a> lower that day on the Nasdaq, with selling pressure continuing through July 29 before the stock found partial footing by the end of the month.<\/p>\n

ASML\u2019s second-quarter results told a different story<\/p>\n

Between those two sell-offs, ASML reported second-quarter results on July 15 that exceeded its own guidance on both revenue and profitability measures.<\/p>\n

Total net sales reached \u20ac9.3 billion for the quarter, a 21.2% increase from the same period a year earlier, ASML\u2019s earnings release<\/a> showed. <\/p>\n

Gross margin came in at 54.0%, exceeding the company\u2019s guided range, while net income reached \u20ac2.9 billion for the three-month period ending in June.<\/p>\n

Earnings per share climbed to \u20ac7.59 from \u20ac5.90 in the year-earlier quarter, a 28.6% increase that reflected growing demand for advanced lithography equipment worldwide.<\/p>\n

ASML CEO Christophe Fouquet<\/a> attributed upgraded forecasts to surging orders and expanded operational capacity.<\/p>\n

The combination of continued strong momentum in customer demand and our ability to respond to that by driving higher output through strengths in our supply chain, our manufacturing, and our installed teams in the field are the primary drivers of our improved guidance.<\/p>\n

Christophe Fouquet<\/p>\n

ASML CEO<\/p>\n

Management raised full-year 2026 revenue guidance to \u20ac43 billion to \u20ac45 billion from the \u20ac36 billion to \u20ac40 billion range set months earlier this year.<\/p>\n

Fouquet cited \u201congoing AI-related investments and continued progress in AI technologies\u201d as the primary drivers behind strengthening demand, the release noted<\/a>.<\/p>\n

ASML sold 86 new lithography systems during the quarter, and its third-quarter guidance of \u20ac11 billion to \u20ac12 billion in revenue signaled further acceleration.<\/p>\n

\"ASMLASML delivered stronger-than-expected second-quarter results, raising 2026 guidance as AI demand drives record orders and accelerating lithography sales.NurPhoto \/ Getty Images<\/a><\/p>\n

ASML\u2019s EUV monopoly remains unchallenged by Chinese competition<\/p>\n

China\u2019s entry into lithography manufacturing involves deep ultraviolet machines, an older technology segment where ASML already competes alongside Japan\u2019s Nikon and Canon. <\/p>\n

But the DUV-to-China revenue at risk from a domestic Chinese competitor is already shrinking on its own. Chinese customers accounted for only about 14% of ASML\u2019s second-quarter sales, The Motley Fool reported<\/a>, and existing export rules already bar ASML from selling EUV and advanced DUV systems there.<\/p>\n

A pending U.S. bill, the MATCH Act, would restrict ASML from selling or servicing DUV machines for the three named Chinese fabs expected to receive the homegrown equipment. <\/p>\n

In other words, the revenue the July 27 selloff was pricing as newly at risk was already on its way to being cut off.<\/p>\n

More AI:<\/p>\n

ASML\u2019s next-generation High NA EUV systems, priced above $400 million, went into high-volume production this July with Intel Foundry\u2019s 18A node.<\/p>\n

That monopoly is what makes ASML a different kind of AI bet. Most AI portfolios concentrate downstream. Nvidia designs the chips, TSMC fabricates them, hyperscalers rent the compute each with vendor risk ASML does not carry. <\/p>\n

When Samsung wins a foundry deal from Intel, ASML sells the machines. When TSMC wins one back, ASML sells the machines. Its revenue tracks industry-wide advanced-chip capex, not any one chipmaker\u2019s market share<\/a>.<\/p>\n

What the July sell-off hinges on<\/p>\n

The July sell-off was priced on things that might happen. Anthropic might build a chip<\/a>. China might catch up in DUV.<\/p>\n

What actually happened during the same window was ASML raising guidance for the second time this year, shipping 86 systems, and confirming Intel Foundry\u2019s first high-volume production on High NA EUV.<\/p>\n

Morningstar\u2019s four-star rating<\/a> and 21% discount to fair value frame the opportunity. <\/p>\n

Whether those two concerns fade as short-term overreactions or mark a longer shift in how AI chips get designed and manufactured is what the July sell-off was really trading on.<\/p>\n

About the authors\"\"<\/p>\n

Damilola Esebame is a finance journalist and CFEI\u00ae whose work spans credit, taxes, retirement, and budgeting. At TheStreet, he covers personal finance news and policy changes that affect your wallet, making complex topics clear and actionable.<\/p>\n

\"\"<\/p>\n

Celine is a writer and editor with over 20 years of experience and has covered diverse news, features, academic\/research, and legal topics. At TheStreet.com, Celine is a senior editor with experience across retail, stocks, investing, personal finance, technology, the economy, and travel.\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"The machines behind every advanced artificial intelligence chip in production come from one company, and its stock just…\n","protected":false},"author":2,"featured_media":38862,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[59],"tags":[25275,25270,753,25276,65,301,25273,18417,519,25272,22452,937,2041,68,25277,751,25269,302,25271,5211,1115,865,25268,25274,1036,670],"class_list":["post-38861","post","type-post","status-publish","format-standard","has-post-thumbnail","category-asml","tag-ai-technology","tag-ai-related-investments","tag-artificial-intelligence","tag-artificial-intelligence-chips","tag-asml","tag-asml-holding","tag-chinese-semiconductor-competition","tag-chip-design","tag-chip-manufacturing","tag-custom-ai-chips","tag-deep-ultraviolet-lithography","tag-earnings-report","tag-euv-lithography","tag-investing","tag-investing-stocks","tag-investment-opportunities","tag-investor-concerns","tag-lithography-systems","tag-market-trends","tag-match-act","tag-revenue-guidance","tag-semiconductor-industry","tag-semiconductor-suppliers","tag-stock-market-analysis","tag-stocks","tag-technology"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/netherlands\/wp-json\/wp\/v2\/posts\/38861","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/netherlands\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/netherlands\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/netherlands\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/netherlands\/wp-json\/wp\/v2\/comments?post=38861"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/netherlands\/wp-json\/wp\/v2\/posts\/38861\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/netherlands\/wp-json\/wp\/v2\/media\/38862"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/netherlands\/wp-json\/wp\/v2\/media?parent=38861"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/netherlands\/wp-json\/wp\/v2\/categories?post=38861"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/netherlands\/wp-json\/wp\/v2\/tags?post=38861"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}